NBR mulling tax exemption policy
Business Report :
The National Board of Revenue (NBR) is preparing a Tax Exemption Policy which is now at the final stage, said NBR Chairman Md Abdur Rahman Khan on Thursday.
The decision to allow tax exemptions is being taken away from the NBR. It will now rest solely with Parliament to grant exemptions, said NBR chairman Md Abdur Rahman Khan.
“This is now at the final stage, it is stated that the government and the NBR will not give any tax exemption, only Parliament will give that. We are making it harsher,”
He made this remarked while speaking at the pre-budget meeting with the Retired Tax Officers’ Welfare Association at the Revenue Building.
Rahman also made it clear that no individual, except for the interest of the republic, will be considered to avail tax exemptions.
According to available data from the NBR, Individual taxpayers received over Tk 40,000 crore in tax exemptions, more than double the amount provided to the companies.
When tax exemptions are granted for social welfare purposes under the specified provision, some people having undisclosed money also tend to exploit these benefits to pay taxes at reduced rates in certain cases.
Tax exemptions are also provided to promote local industries, encourage investment in backward areas and high-tech industries and attract businesses to economic zones.
However, there are complaints that some industries have been exploiting tax exemptions for years by using their influence or by unethical means.
According to the NBR, some 102 types of sectors currently receive partial or full tax exemptions. Forty of these exemptions are applicable to individual taxpayers, while the remaining are applicable to companies, industries, or investments.
The NBR claims that widespread tax exemptions are costing the revenue board a significant amount of revenue while no study has been done yet to assess the impact of these exemptions.
Md Abdur Rahman Khan several times referred a study where it showed that NBR gives the same amount of tax exemptions what it collects as revenues.
The NBR chairman said that the revenue collecting authority is thinking actively to rationalise the taxpayers related issues.
“They will pay taxes on their income or profit. If they have refund, we’ve to pay that, there is nothing to put restrictions on their logical refund claims,” he said.
Rahman also said that this time the government wants earnestly to restore discipline in the revenue sector.
“We’ve used the policy very aggressively in the past, it was seemed that commissioners, first secretary and second Secretary from the NBR will do everything to collect the revenues,” he said.
Abdur Rahman Khan said that zero return submission is almost two thirds of the total income tax return.
“I’ve asked the field-level officials why they are not serving notices to these taxpayers,” he said.
He put emphasis on the enhancement of operational efficiency and functional competence among the tax officials.
“We’re not applying these as we’re getting out from these two for collecting revenues. We’re totally dependent on the policy,” he added.